Yesterday, a federal jury in Cleveland ruled for Whirlpool Corp. in a warranty-based class action involving allegedly defective front-loading washing machines. As discussed in an earlier post, the case had been up and down to the Supreme Court, and given the Court’s recent class action rulings, that was it was allowed to proceed to trial was rather unexpected. Continue reading
Recent federal court decisions relaxing the standards for class action certification must have plaintiff class action lawyers around the country celebrating. It now seems that a mere handful of customer complaints can support a class action lawsuit on any consumer product. What should manufacturers do to address this development and resulting increase in liability exposure? Should they spend more money up front to resolve warranty claims, before they end up in suit? Or, should they fight it out in court and hope to curtail the recent trend? Either way, we suspect manufacturers’ costs are going up. Continue reading
Competition benefits consumers far more than so-called consumer protection laws and the red-tape they’re wrapped in. The former delivers better quality and service and a lower price, while the latter needlessly drives up costs on both sides of the transaction and keeps seedy lawyers in business. Want proof? Look at what Kia is doing in Australia, and why. Continue reading
Imagine if you will, you are the founder and CEO of ABC, Co., a small to midsize company that’s been sued for millions of dollars in a breach of contract action. Next imagine that, just before sending the jury out to deliberate, you heard the judge say to them: “It is up to you to decide what ABC, Co.’s obligations were under the contract.” Feeling queasy? Well, here’s the kicker: your company wrote the contract.
Recently, a scenario just like this one played itself out in a Chicago courtroom. How’d it turn out, you ask? Read on. Continue reading
The same article keeps popping up every other week or so in one publication or another. Its headline either asks if extended warranties are worth the cost or screams they are not. It gives the same advice – “buy smart” – and generally reaches the same conclusion on whether you should buy a service contract – “It depends”. See here, then here, here, here, here, and here. Why is somebody always picking on extended warranties?
Here are 5 reasons why I think extended warranties make an easy target. Continue reading
Some interesting notes about the goings on in the warranty business. Continue reading
“Merchantability” is one of those legal terms-of-art that defies precise definition. Courts ruling on implied warranty of merchantability claims generally frame the question as whether the product was “reasonably fit for its intended purpose.” But what any given jury will find to be “reasonable” is anyone’s guess. So better for the defendant that the case never get to the jury. I think Chrysler might agree. Continue reading
In her recent column, Everyday Cheapskate Mary Hunt begins by taking a swipe at extended warranties: “While I cannot say that every extended warranty would be a rip off, that’s the way I want you to start thinking of them.” But she concludes her piece by noting that, “On a personal note, there are only two products for which I have and will continue to buy the extended warranty: Apple products … and treadmills.” Confusing? Well not really. Continue reading